New survey reveals half of Bega Valley businesses could collapse in 2021

Half of Bega Valley’s businesses say they lack confidence in the viability of their operations in 2021, following two hellish summers of bushfires, and hard border closures due to COVID-19.

This worrying statistic stems from an online survey of 177 businesses in the popular coastal tourist destination during the Victorian border closure between 31 December, 2020, and 11 January, 2021.

That period is traditionally the region’s busiest time, with December and January usually bringing in $75 million in revenue, and January to March accounting for about 32 per cent of annual visitation numbers.

The impact of the bushfires on Bega’s economy was estimated to be $91 million before the state’s border closure hit businesses again, reducing their annual turnover by 46 per cent.

A total of 81 businesses – 54 per cent – had to reduce their staffing levels, with a total of 53 full-time staff and 218 part-time staff laid off during the period, the survey found.

Although 49 accommodation businesses received new bookings from Sydney and Canberra during this period, 62 per cent did not experience any turnover recovery during the Victorian border closure period.

Anthony Osborne is the managing director at Sapphire Coast Destination Marketing, which helped Bega Valley Shire Council and Destination Southern NSW fund the Bega Valley Business Survey.

He says the findings published in ‘Bega Valley Business Survey Report: Impacts of the Victorian Border Closure’ reflect the uncertainty and anxiety among local business owners about their ability to get visitors through their doors, and when the next border closure or disaster will hit.

“How can businesses be confident when two years in a row we’ve had border closures?” asks Anthony. “People forget about the border closure we had after the fire when the Princes Highway closed for two to three months.

“There’s been this endless, rolling interference to the visitor market and I don’t see any reason why you wouldn’t be pessimistic because that’s life at the moment.”

Peter Caldwell, director of Longstocking Brewery in Pambula, took part in the survey and reveals just how bad the impacts were on his and other local businesses.

“While I wholeheartedly supported the border closures if there was a risk of COVID-19 not being managed in NSW, or having an impact on our Victorian cousins after already suffering through lockdown, the impact on us was dramatic,” he says.

“We had just four days of excellent sales when the Victorian border closed. We had 130 people booked in, of which just seven turned up. We tried to re-book people but were unable to, and as a consequence had to lay off staff.

“It was just so ironic that this happened on the exact same day as the fire threats last summer. It brought back all of the emotion into it. We just went into fight or flight mode. But we survived. We’re still here and the locals have been enormously supportive. Despite it being very challenging, we are all in it together.”

Bega Valley Shire Council Mayor Russell Fitzpatrick is encouraging business owners in need of support to reach out to the Bega Valley Business Support Group.

The organisations behind the survey are also advocating for recommendations made by the participating businesses, including calls for support agencies to recognise the cumulative impacts of disasters to businesses during recent years; a coordinated approach to border restrictions rather than the hard approach applied on 31 December by the Victorian Government; and more promotion of the area.

However, Anthony says the best way to support the region is to “come and spend some money”.

Since the survey, research companies such as Roy Morgan have reported that national business confidence has lifted.

But Anthony says it’s too soon to be optimistic in Bega Valley.

“The cuts were so significant and deep to the income of these businesses that they just won’t get it back in this short amount of time,” he says. “Many have had to refinance and recovery will likely take two to five years.”

Peter agrees with Anthony and says he’s sure a lot of businesses won’t survive.

“To lose the majority of our income twice is just… wow,” says Peter. “We are seeing some visitors come back, some activity, but when you look at the books it’s devastating.”

Sapphire Coast Destination Marketing, Bega Valley Shire Council and Destination Southern NSW are considering funding another survey later in the year to see whether confidence has changed.